How to Choose the Right Health Insurance Plan for You

Odds are good you have health insurance through your employer, like most do. But for the many others who buy their insurance individually, choosing a plan can be a challenge. An overview of steps to take and things to consider can make the process easier.

GETTING STARTED

If your job doesn’t provide health insurance, you can search for a plan on your state’s Affordable Care Act marketplace, if there is one, or the federal marketplace. HealthCare.gov will direct you to your state’s exchange if appropriate; otherwise you will use the federal marketplace.

If you don’t qualify, or don’t want for income-based premium subsidies you can purchase a policy through directly from an insurer or through a private exchange.

COMPARE TYPES OF PLANS

You’ll need to decide what type of plan to pick: an HMO, PPO, POS or EPO. These are the most common categories.

Health Maintenance Organization (HMO): The most restrictive type of plan, HMOs require you to stay in a specified network of physicians and hospitals, except in emergencies.

Point of Service Plan (POS): This kind of plan combines HMO and PPO features. POS require you to go to a primary care physician for referrals to specialists. You can go out of the network, but must first get a referral from your primary doctor to reduce out-of-pocket costs.

Exclusive Provider Organization (EPO): Like an HMO, you are required to use a particular network of physicians, hospital and labs.

REVIEW THE NETWORKS

If you already see doctors you prefer to stay with, find out if they accept the insurance plans you’re considering. Check each plan to see if your doctors are listed in their provider directories, or ask your physicians directly which plans they take.

Deductible – This is a specified amount you must pay before the insurance company pays a claim. If your deductible is $2,000, you pay for covered services up to $2,000. Keep in mind that:

ACA plans play full cost of certain preventive benefits regardless of whether you’ve met the deductible.

Many plans pay for other particular services before you’ve met your deductible.

Some plans separate deductibles for specified services, such as prescription drugs.

Family plans might feature both a per-person individual deductible as well as a deductible that applies to all family members.

Copayment – A copayment is a fixed amount you pay for a service. Some plans always charge you this same amount while others require you to pay full price until your deductible is met.

Coinsurance – You might also be required to pay a percentage of costs for covered services after you’ve paid your deductible. A plan might specify that you pay a percentage, such as 20% of the allowed cost for an office visit. Other plans specify percentages when it comes to higher costing services such as hospitalization.

COMPARE BENEFITS

Once you understand how each plan compares in cost, check to see which covers a broader set of services. One plan might have great coverage for mental health services while another might instead have better coverage for emergency care.

KEEP IN MIND

Everyone has different health care needs, and yours can help determine what kind of plan to choose.

If you’re healthy, don’t use health care services often, and want a lower premium payment, consider a higher deductible. This makes sense especially for young people, who want to pay less month to month but also want comprehensive coverage in the case of unexpected illness, an accident or changing life situation.

If you have a chronic condition and need health care services often, you might want to pay a higher premium, lower deductible and smaller fees for doctor visits and other services. By paying a higher premium every month you will generally have lower out-of-pocket expenses to pay.

If you have a number of prescriptions you take regularly, compare plans. Check to make sure your medications are covered under the health plan’s formulary. Anything not on the list will cost more.